MOSCOW, July 16. /TASS/. Russia’s economy grew by 0.8% in Q2 quarter-on-quarter, with overheating persisting so far, according to the Central Bank’s bulletin "What Trends Say".
"Due to active growth in May-June seasonally-adjusted GDP in Q2 increased by 0.8% compared with Q1, according to our estimate. Such economic expansion coupled with an increase in price growth points at least to persisting economic overheating," the regulator’s analysts said.
They also noted that "the economy is preparing to adjust to the trajectory of balanced growth, though this will not have an immediate impact on the labor market." "This is why economic overheating will most likely subside gradually," analysts added.
Russia’s labor market intensifies proinflation risks, the Central Bank’s experts added. "Labor demand has reached its all-time high and continues growing with a mixed picture on sectors. The possibilities for expanding labor supply are limited by negative demographic trends. Such a situation incites the rates of wage growth much higher than labor productivity, which creates additional proinflation risks," analysts said.
The tight monetary policy that has been pursued for a long time, may facilitate recovery of balance and stabilization on the labor market through cooling of demand for labor, the regulator noted. "This will allow balancing the situation in the economy and on the labor market, considering a long period that will be required for adjusting the supply of goods and services on the market through investment in new equipment and technologies," according to the bulletin.